When Slim Dusty released his iconic song A Pub with No Beer, few people realised the song was inspired by a poem written at a lively country pub in Ingham, Queensland.
In 1943 Ingham farmer Dan Sheahan went to his local watering hole and found that visiting American soldiers had drunk the pub dry. He then penned the famous poem that Dusty later took inspiration from, and which is still on display at the historic hotel.
Recently sold to Shane Punton and Ken Dark, private investors from New South Wales, it was not only Lees Hotel’s nostalgic ties to the past which caught their attention but also the promise of a solid return on investment.
“I’m always on the lookout for the right sort of thing to diversify our portfolio, and when this came across the desk, it was at the top of the pile from a return perspective,” Mr Punton said.
The property, which includes a hotel, 20-room motel and retail shops, also offers plenty of potential for tapping into the domestic tourism market.
“We’re hoping that we can appeal to travelling grey nomads [who] will appreciate the memorabilia on display,” Mr Punton said.
Sold by NSW-based James Carrick and Queensland-based Antonio Curulli of Tourism Brokers, it is one of many regional Queensland pubs that are coming under the hammer and attracting strong interest from interstate investors.
“As people are fleeing the southern states, investors are looking at these sorts of assets,” Mr Curulli said.
“These pubs are the lifeline of the town, they’re a gathering place,” he said. “And we’re starting to see pubs with accommodation compete with caravan parks and motels.”
Greg Bell and the team at Ray White Commercial on the Gold Coast are also reporting strong interest from interstate, having recently sold the Jacobs Well Bayside Tavern to a Sydney-based investment company for $8.5 million, after more than 130 responses to their request for expressions of interest.
“As a result of the COVID-19 pandemic, there’s more interest than ever before in the Sunshine State, with pubs and taverns with coastal links proving to be like gold dust,” Mr Bell said.
“When you combine the affordability of the state, the climate, historic low interest rates and the relative safety from the COVID-19 pandemic, it’s the perfect recipe for buyers to invest their money.
“We’re expecting there to be a big uplift in migration here in the next generation and that’s why we’ve seen massive demand from interstate for secure asset classes like these.”
Dr Nick Osbaldiston, a James Cook University sociologist who studies lifestyle migration, agreed that while regional Queensland continues to lose young people to urban areas, overall both greater Brisbane and the state’s regional areas are experiencing population growth.
“I think that there’s this confidence that people are moving to regional Queensland, and that’s kind of accelerating this thirst for investment,” Dr Osbaldiston said.
“So there’s cause to be optimistic. And, when you’re looking at the industries that did well during pandemic lockdowns, the alcohol industry was one of them.”
One regional area experiencing population growth is Mount Isa, largely bolstered by the local mining operations.
This growth, along with a good location and promising returns, attracted the interest of a national hotel group which recently purchased the Barkly Hotel Motel, marketed by Leon Alaban, Tony Bargwanna and Christian Tsalikis of Savills Australia.
Located minutes from Mount Isa airport and walking distance from the epicentre of Mount Isa’s mining operations, the Barkly Hotel Motel offers diverse income streams through gaming, 44 motel rooms, food and beverage, retail and a leased gym.
But according to Andrew Jolliffe, HTL Property managing director, the interest in acquiring regional pubs is not just particular to Queensland, but also includes New South Wales.
Since 2018, HTL Property has negotiated the sale of 51 regional and coastal pub assets across Australia, with a dollar value of more than $332 million.
He says the strong interest in regional pubs is driven by two factors:
“The first is that there exists currently a material shortage of hotel property stock available to be purchased in metropolitan locations nationally … there is a supply versus demand imbalance steering investors further afield in their pursuit of hard yielding assets,” Mr Jolliffe says.
“Secondly, the closure of both national and state borders over the past 12 months has given rise to a robust increase in regional travel, the consequence of which is a reconnection or improved awareness of how attractive our regional areas are as both investment and lifestyle alternatives.”
That’s a sentiment that Slim Dusty himself would no doubt have approved of.
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